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ViacomCBS (VIAC) to Report Q2 Earnings: What's in the Cards?

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ViacomCBS is slated to report second-quarter 2020 results on Aug 6.

Markedly, the Zacks Consensus Estimate for second-quarter earnings has been revised 8.5% upward to 89 cents per share over the past 30 days, implying a decline of 23.3% from the figure reported in the year-ago quarter.

Moreover, the consensus mark for sales is pegged at $6.04 billion, suggesting growth of 58.6% from the figure reported in the year-ago quarter.

Notably, in the trailing four quarters, the company’s earnings beat the Zacks Consensus Estimate in three quarters but missed the same once, the average negative surprise being 1.2%.

ViacomCBS Inc. Price and EPS Surprise

ViacomCBS Inc. Price and EPS Surprise

ViacomCBS Inc. price-eps-surprise | ViacomCBS Inc. Quote

Let’s see how things shaped up prior to this announcement.

Factors to Consider

ViacomCBS’ second-quarter results are expected to reflect lower ad spending due to the coronavirus outbreak. Notably, advertising revenues accounted for 37.2% of the company’s top line in the first quarter of 2020.

Moreover, due to the coronavirus impact on the economy that resulted in job losses, cord cutting is expected to have increased in the to-be-reported quarter. This, along with stiff competition from streaming services like Netflix, Disney+ and Amazon prime video, is anticipated to have hurt ViacomCBS’ subscriber base.

Further, film revenues are expected to have taken a hit in the second quarter due to the closure of movie theaters globally amid the coronavirus pandemic. Markedly, the company doesn’t expect to release any new movies until theaters reopen. It has also experienced production delays in television and film programming. This is expected to negatively impact content-licensing revenues in the to-be-reported quarter.

Nevertheless, a solid portfolio of streaming services (both advertising and subscription-based offerings) including CBS All Access, Showtime OTT, Pluto TV, Noggin and BET+ is expected to have bumped up viewership amid lockdowns and shelter-in-place guidelines.

Notably, in first quarter, Pluto TV was launched across 17 countries in Latin America with more than 12,000 hours of Spanish-language programming that reflected ViacomCBS’ expanding international footprint.

What Our Model Suggests

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

ViacomCBS has an Earnings ESP of +23.03% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Other Stocks to Consider

Here are a few companies besides ViacomCBS worth considering as our model shows that these also have the right combination of elements to beat on earnings in their upcoming releases:

GoPro (GPRO - Free Report) has an Earnings ESP of +9.86% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Peloton Interactive (PTON - Free Report) has an Earnings ESP of +29.03% and is #2 Ranked.

MercadoLibre (MELI - Free Report) has an Earnings ESP of +93.88% and a Zacks Rank of 2.

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